Snap lost $514 million last year and warns that it 'may never be profitable'

Snapchat parent company Snap Inc. posted a net loss of $514.6 million in 2016, according to the initial public offering prospectus it filed on Thursday.

The company’s losses have been widening in recent quarters as Snap ramps up spending and hiring.

And Snap also that it “may never achieve or maintain profitability,” as it plans to continue investing heavily in its business.

“We began commercial operations in 2011 and for all of our history we have experienced net losses and negative cash flows from operations,” Snap said in its regulatory filing with the SEC. “If our revenue does not grow at a greater rate than our expenses, we will not be able to achieve and maintain profitability.”

The warning comes as Snap plans to list shares in March, and could fetch a valuation of as much as $25 billion, people familiar with the matter have said.

Snap reported a net loss of $372.9 million in 2015, further indicating that its expenses will continue to grow. It had annual revenue of $404.4 million in 2016, up from $58.6 million in 2015.